ECON 1113 Principles of Macroeconomics Department of Economics - University of Oklahoma Spring, 2018

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1 Course Description: ECON 1113 Principles of Macroeconomics Department of Economics - University of Oklahoma Spring, 2018 We will cover major theoretical and empirical issues arising in the study of macroeconomics. Macroeconomics builds upon the principles of microeconomics by studying the aggregation of decisions made in the micro-economy. It is the study of the aggregate economy, and to understand it we must take into account the subtle interactions across the agents of the economy. We will describe the course as a study of 3 basic principles that build on each other and make up the overall ups and downs of the economy : 1) Individual Choice: the core principle that underlies all of economics (macro and micro) is essentially the study of how individuals (firms and households) make decisions. Examples: scarce resources; opportunity cost; marginal benefit versus cost; and incentives. 2) The Interaction of Individual Choices: Macroeconomics is about the aggregation of individual choices and the measurement of overall outcomes. Examples: Movement towards equilibrium; Efficiency; measuring production (GDP), unemployment, and inflation; Government intervention in market failures. 3) Economy-wide Interactions: The most subtle (and controversial) component of macroeconomics that usually applies to short-term economic fluctuations such as recessions and expansions. We will see that this leads to feedback effects and multipliers that complicate aggregation. The last third of the course will explore the government s role in this area. Examples: Aggregate Spending versus Production Capacity, Policies that affect spending. Course Objectives: The aim is to give you the necessary tools to critically read and apply your knowledge to current issues in macroeconomics and be fluent in the standard data essential to the field. You should be able to differentiate between what determines long-run growth and short-run growth, and how public policy affects each. To do so we integrate two skills that are essential in the study of macroeconomics: a) Using Economic Models: a model is a simplified representation of a real situation that is used to better understand real life. There is no one model, but for each set of assumptions we make it acts as a tool to understand how that certain world looks like. In this course, these will usually be analyzed with graphs but at times require algebra tools. b) Read Economic Data: a large part of the class will define macro economic variables such as Gross Domestic Product and Unemployment.

2 Aside from the lectures/textbook which comprise the main material of the course, we will fulfill these class objectives with an introduction to Economics in the media. Some examples of resources to read: Also, if a couple interesting podcasts to keep in mind: Course Information: LECTURE TIME: Tuesday, Thursday: 3:00pm 4:15pm. CLASSROOM: Cate Center 237. WEBSITES: Sapling Learning, SquareCap, and Canvas. However, you only need your Canvas log-in for all of these. Instructor Information: Ariel Weinberger: ariel.weinberger@ou.edu OFFICE HOURS: Wednesdays 10am 12pm or appointment. OFFICE: CATE 421 CCD1 Teaching Assistant Information: Ji Gu: jgu@ou.edu OFFICE HOURS: Wednesdays 2-3 pm. Office: CATE 334 CCD1 Gabe Lebovich: gabe.lebovich@ou.edu OFFICE HOURS: Tuesdays 12 1 pm Office: CATE 230 CCD1 Rafael Zago: Rafael_zago@ou.edu OFFICE HOURS: Monday 4-5 pm Office: CATE 222 CCD1

3 Textbook Information: Main Textbook: Paul Krugman and Robin Wells, Macroeconomics, 4 rd Edition, The e- book will be available to you through the Sapling Learning site that you will use for all assignments. There will also be short article readings, but these additional readings will be available through the class website (under Files ). I will announce when these are available. Course Websites: Announcements, exam grades, and other information will be posted on CANVAS. Although I intend to send out reminders when new materials are posted on CANVAS, it is your responsibility to check the website regularly for updates. We will also use Canvas as a way of Sapling Learning: Grading: You must register for the SAPLING Learning course, which is integrated within Canvas (go to Assignments and click on the Sapling Learning assignment, then click on the link to that takes you to a new tab for Sapling). Access to Sapling must be paid for, but it gives you access to the online text, which is the only required textbook for this class. There will be weekly homework assignments assigned and to be completed on this platform. Sapling Learning offers a grace period on payment; this is 14 days from the first day of the term. Use the following link for instructions: There will be three exams, the online problem sets, Reading assignments, and Squarecap quizzes. I will give 3 midterm exams, with no cumulative final. The highest weight will be put on the 3 rd exam (which will also be the longest). The exams will be on the following dates: Tuesday February 13 th and Tuesday March 13 th and Thursday May 3 rd. Your final grades will be calculated using the following weights: 15% online homework, 10% Reading Reports, 5% In class quizzes, 20% Midterm 1, 20% Midterm 2, 30% Midterm 3. Makeup exams will NOT be given. If you have a reasonable excuse for missing a midterm with proof (e.g. a signed doctor s note) then all weight will be transferred to Midterm 3. You cannot pass the course without taking Midterm 3. Homework Assignments:

4 There will be weekly problem sets to be completed online through the Sapling course. You will receive the score automatically and can review the solutions after you have submitted the homework. Due dates for the assignments will be listed on the Sapling site and I will announce them in class. In general, you should expect an assignment for each lesson in class, separated by chapters. Due to the technical limitations of having online homework, the deadline is fixed at a specific time. There is no such thing as I was 2 minutes late because once the system turns off submissions then there is nothing that can be done. So you should plan on being able to submit with ample time to handle technical glitches. I will drop the bottom 2 scores in order to correct for bad luck that can be associated with technical difficulties. Reading Assignments: Throughout the course I will assign short readings relevant to our lectures. These will be either articles from newspaper publications or blog posts from prominent economists. I will announce when the reading is posted on Canvas, and when you are responsible to have read it. During that lecture, I will quiz you on that reading at the beginning of class using the Squarecap app. For each reading, I will ask you to complete a ~400 word report (about 10 overall). There will be about weekly readings (but not on Midterm weeks) and they are due on the day we discuss them (I will of course tell you beforehand). For each reading, you must turn it in on the lecture when the reading is discussed. It must be printed out: NO submissions will be accepted. [For more instructions, see the instructions sheet posted on Canvas.] In Class Quizzes: During class time, we will go through practice questions that relate to the material covered. I will ask you to take out a small sheet of paper and write out your work for these problems. You will hand these in and they will be graded and recorded by the TA. They will be graded on accuracy, but I will help you work through most of them in class. These are worth 5% of your overall grade. Note that I will drop your lowest 5 scores to make up for any absences that you might have during the semester. Expectations: The most important aspect of the class is to put in time and energy that allows you to understand the material. I understand that new concepts take some time to digest, and for this reason I expect each student to devote at least a couple hours a week (when there is no exam) outside of lecture on this course. You should expect me to express the material clearly and rehash it is as necessary, but in return I expect you to play an active part in the process by working to make the concepts click. University Policies: Academic Integrity: All students are expected to conform to college-level standards of ethics, academic integrity, and academic honesty. By enrolling in this course, you agree to be bound by the Academic

5 Misconduct Code published in The University of Oklahoma Student Code ( For further clarification please see: All members of the community recognize the necessity of being honest with themselves and with others. Cheating in class, plagiarizing, lying and employing other modes of deceit diminish the integrity of the educational experience. None of these should be used as a strategy to obtain a false sense of success. The need for honest relations among all members of the community is essential. Religious Observance: It is the policy of the University to excuse the absences of students that result from religious observances and to reschedule examinations and additional required classwork that may fall on religious holidays, without penalty. Reasonable Accommodation Policy: Students requiring academic accommodation should contact the Disability Resource Center for assistance at (405) or TDD: (405) For more information please see the Disability Resource Center website Any student in this course who has a disability that may prevent him or her from fully demonstrating his or her abilities should contact me personally as soon as possible so we can discuss accommodations necessary to ensure full participation and facilitate your educational opportunities. Class Schedule (preliminary and subject to change): Week 1: Tuesday Jan 16 th : Introduction (Ch. 1) Thursday Jan 18 th : Intro to Models (Ch.2) Week 2: Tuesday Jan 23 rd : Intro to Models: Tradeoffs and Comparative Advantage (Ch.2) Thursday Jan 25 th : Supply & Demand (Ch. 3) Week 3: Tuesday Jan 30 th : Supply & Demand and Distortions (Ch. 3) Thursday Feb 1st th : S & D and Trade (Ch.5) Week 4: Tuesday Feb 6 th : International Trade (Ch. 5) Thursday Feb 8 th : International Trade (Ch. 5) Week 5: Tuesday Feb 13 th : Midterm 1 Thursday Sep 15 th : Macroeconomics: The Big Picture (Ch. 6) and start Ch. 7. Week 6: Tuesday Feb 20 th : Tracking the Macroeconomy (Chs. 7). Thursday Feb 22 nd : Tracking the Macroeconomy (Ch. 7). Week 7: Tuesday Feb 27 nd : Tracking the Macroeconomy (Ch. 7).

6 Thursday Mar 1 st : Tracking the Macroeconomy (Ch. 8). Week 8: Tuesday Mar 6 th : Tracking the Macroeconomy (Ch. 8). Thursday Mar 8 th : Income and Expenditure Model (Ch. 11) Week 9: Tuesday Mar 13 th : Midterm 2 Thursday Mar 15 th : Income and Expenditure Model (Ch. 11) Week 10: Tuesday Mar 20 th : Spring Break, NO CLASS Week 11: Tuesday Mar 27 th : Income and Expenditure Model (Ch. 11) Thursday Mar 29 th: Aggregate Demand and Aggregate Supply (Ch. 12) Week 12: Tuesday Apr 3 rd : Aggregate Demand and Aggregate Supply (Ch. 12) Thursday Apr 5 th : Money Banking and the Fed (Ch. 14) Week 13: Tuesday Apr 10 th : Money Banking and the Fed (Ch. 14) Thursday Apr 12 th : Monetary Policy (Ch. 15) Week 14: Apr 17 th : Long-run Growth (Ch. 9) Apr 19 th : Long-run Growth (Ch. 9) Week 15: Tuesday Apr 24 th : Saving, Investment and the Financial System (Ch. 10) Thursday Apr 26 th : Saving, Investment and the Financial System (Ch. 10) Dead Week: Tuesday May 1 st : REVIEW Thursday May 3 rd : Midterm 3 NO FINAL

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